Coronavirus Job Retention Scheme

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees' salary for those employees that would otherwise have been laid off during this crisis.

Eligibility

All

Access

If your employees do not have work to do because of the crisis you need to designate them as “furloughed”. This means they remain on the payroll rather than being laid off but they cannot do any work for you. 

The scheme will be backdated to 1 March 2020, but only for those employees who have not been able to work for you during this period.

Employees information will need to be submitted on a new HMRC online portal. The employee will be paid through the payroll as normal and HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. You can top up the additional 20% but there is no obligation to do so.

Due to the fast pace of these changes, the portal and reimbursement system are not yet available but HMRC are working urgently to set these systems up. It is anticipated that funding will be available in April.

What you need to do.

  • Check your employees contracts to see if there is a clause allowing you to reduce their hours. If there is, have a conversation with them and explain that they are being furloughed due to lack of work, that they will remain on the payroll, and you will apply to HMRC to access the scheme to cover 80% of their normal wages.
  • If their contract does not allow variation of hours, you need to follow employment law process and first need to have a consultation with them to include a clause allowing variation of hours. Consultation periods can be short (a matter of hours if it is obvious there is no work). Then advise them they are designated as furloughed.
  • If employees will not accept being furloughed and there is no work, follow redundancy procedure.
  • If we process your payroll, advise our payroll team of the furloughed employees and the date applicable. If you process your own payroll, watch for the HMRC portal becoming available to register affected employees.
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